POULSBO — Fred Hill Materials, which has been delivering concrete to residential, commercial and military customers throughout a five-county area on the North Olympic and Kitsap peninsulas for 66 years, has filed for Chapter 7 bankruptcy.
Employees of the Poulsbo-based company that had offices in Port Townsend and Sequim were informed of the action in an April 20 letter, making that date their last day of employment.
The action will be recognized officially today in U.S. Bankruptcy Court in Seattle, according to a company spokesperson.
“The positive plans and forecasts for the company did not materialize,” Fred Hill attorney James Tracy said during the public comment portion of Monday’s meeting of the Jefferson County commissioners.
“Major projects that the company was counting on were delayed, canceled or tied up in the courts,” he said.
“This is a tragedy for the employees and their families of the company, although it is no different from what a lot of people are feeling due to the decrease in the building trades business.”
The company had 42 employees at the time of its closure.
“During the past several years, we thought we could survive the depressed state of the construction industry, one further burdened by the banking credit crisis,” said owners Alex and Adam Hill in the April 20 letter to employees.
The letter stated that past quarter sales were down 46 percent from 2011, which were down 15 percent from 2010 and down 70 percent from 2005.
Alex and Adam Hill are the grandsons of Fred Hill, who founded the company in 1946.
Fred Hill Materials Inc. is a separate company from the proposed Thorndyke Resource project currently undergoing an environmental review as part of the permitting process in Jefferson County.
Formerly known as the “pit-to-pier” project, Thorndyke Resource involves a plan to build a 4-mile-long conveyor belt from the Shine gravel pit to a 1,000-foot dock to move gravel to barges for transport out of Hood Canal.
“The Thorndyke Resource project will move forward accordingly,” said company spokesman Douglas Weese.
“Although Fred Hill Materials served as a representative for project proponents, it’s always been a separate entity and has never been the project applicant.”
The company sold its interest in the Shine operation to Auburn-based Miles Sand and Gravel in 2009 in an effort to alleviate its financial difficulties.
The company then filed for reorganization under Chapter 11 bankruptcy in February 2010. Offices remained open while the company restructured its finances.
Forms filed at the time indicated the change in Shine ownership allowed the company to reduce its debt and al focus on its “core business” as a concrete supplier.
Forms filed with U.S. Bankruptcy Court for the Western District of Washington in 2010 showed $8.6 million in assets and $5.3 million in liabilities.
According to a company press release at the time, 18 jobs were lost, leaving 100 employees.
Between filing for bankruptcy in 2010 and March 2011, Fred Hill Materials’ largest debtor, Western Conference Teamsters Pension Trust, said the company had not made any of its payments — more than $480,000 in delinquent trust fund contributions, liquidated damages, interest and attorney’s fees and costs.
The court began proceedings to convert the company’s Chapter 11 bankruptcy to Chapter 7 in March 2011.
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Jefferson County Reporter Charlie Bermant can be reached at 360-385-2335 or at charlie.bermant@peninsuladailynews.com.
The North Kitsap Herald contributed to this report.
